Tax Write Offs For A Home Business

If you have a home business, then you need this list of deductions you can write off on your taxes.

Having a home business means that you don't have commuter time, you are your own boss, and you get to enjoy write offs on your income tax return at the end of the year. But there are some requirements though.

First, in order to be able to deduct a portion of anything related to your home office, you must use that space only for your business. That means if you also use your home office to handle personal business, then it's not a business office.

Second, you must use your home office on a regular basis in order to conduct your business. According to the rules and regulations of the Internal Revenue Service (IRS), you must use your home office to conduct most of your work in. If you're a freelance writer or a web designer, then you probably perform the majority of your work in your office. If you are engaged in another type of occupation that takes you out of your office most of the day, you can still claim deductions that are related to your home office if you use it to perform paperwork duties, hold business meetings, et cetera.

You can only deduct the amount of space you use in your house or apartment for your business. That means, if your office is one of ten rooms in your home, and the rooms are approximately the same size, then you can deduct one tenth of your rent, mortgage, property taxes, utilities, renter's or homeowners insurance, maintenance costs, and so on.

Now that you have a home business with an established office, what are some of the typical things that you can write off?

1. Telephone - A separate business telephone and any expenses related to it- such as long distance- can be an income tax deduction. A home telephone is not a write off because it's also used for personal use.



2. Office Machines - The costs of a Personal or a Notebook computer, printer, copier, calculator, et cetera, can be deducted if they are used exclusively for your home business.

3. Office Furniture - The costs of a desk, chair, filing cabinets, lamps, and other furniture that you use in your home office.

4. Office Supplies - These would include pens, paper, file folders, ink cartridges for your machines, erasers, bulletin boards, calendars, dictionary, glue, transparent tape, and the like.

5. Auto - If you travel during the course of operating your home business, you'll need to keep a log of the miles you drive. The Internal Revenue Service (IRS) allows you to deduct so many cents per mile.

An easy way to keep track of miles related to business is to keep a small notebook in your auto. Then, every time you get ready to travel on business, jot down the date and the beginning mileage. When you return from your trip, simply mark down the ending mileage.

6. Medical Expenses - These include medical insurance premiums and other "out of pocket" expenses.

Since tax laws change every year, make sure that you check the current laws so you know exactly what you can and cannot deduct on your income tax form. You can visit www.IRS.gov/ on the Internet to find out the current laws. Everyone who owns a home business should have an accountant or a tax adviser that can help them get the most legitimate deductions available.

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